Ya you guys deserve a heads up and some insight into how things work in China.

A lot of the price changes you see are driven by the trading market in Shenzhen.

Let's take an example:  We list an old model ( say 850)  at  $250 on the website ( just an example ). A customer will come in and order 4000 and pay immediately.  The next minute they are all over alibaba, wechat, etc, being adverstised for  $275  in Shenzhen. Traders basically. there is no stopping them. What it means basically is that we got it "wrong" when we thought the market price was $250.

We try to calculate a market price based on BTC prices and difficulty,  but the market has different expectations for the future. the market may think MOON! and snap up all the product, reselling to make a quick buck.  It's rather vicious and defies everything you might think from a western perspective. Of course things go the other way, when traders think MOON and the opposite happens.  think 2018.

So we try to pick a price where the stuff wont sell too slowly and not too quickly. We also have to decide how much to pre sell and how much to save for future spot market selling.

Lets say  I have   X machines projected to be built in sept.   do I want to pre sell all of them now? or do I want to sell some now at a discount and save some portion in case BTC continues to rocket to the moon?

The best way to look at this is that the miner manufacturers are the longest  betters in bitcoin. When we bet the cash to build a machine  that bet wont be sellable for 90 days ( 60- 90 depends)  if BTC moons, then its all good; if it crashes  there is no way we can exit the position as a trader could with a stop loss. The cash to build a machine gets laid out in advance. we are commited deep and hard.

As BTC continues up expect the same kind of craziness we saw in the end of 2017 when supplies were really tight.

This is just bitcoin. When it moons the hardware manufactures have no way to respond rapidly; we will always lag the moon because  it takes time to make machines. The shortage of machines  then works to make it moon harder and  if difficulty does not  keep  up to moderate profitability  then the feedback for even more demand is set in place. and it moons harder.!   If the hardware manufacturers  overbuild (2018), then eventually  difficulty will kick in to moderate profits and then reduce profits... and then the hardware costs come down... just in time for the slow movers to jump on the train and make it even more difficult.. or it comes down so hard that miners exit..

Long ago I used to work in modelling.

I tried to model this.

still trying.